- 1875 - Opéra comique Moralès and the soldiers loiter before the guard house commenting on passers-by. Micaëla appears seeking Don José, a corporal, but is told by Moralès that he is not yet on duty, so why does not she stay and wait with them? She runs away saying that she will return later. Zuniga and José arrive with the new guard, imitated by a crowd of street-children.
The factory bell rings and the cigarette girls emerge from the factory, greeted by young men who have gathered to flirt with them. The girls enter smoking cigarettes, and finally Carmen appears, and all the men ask her when she will love them (""). She replies in the famous Habanera "Love is a rebellious bird that no one can tame. He has never known law. If you don't love me I love you, if I love you watch yourself!". When they plead for her to choose a lover from among them, she tears a bunch of cassia from her bodice and throws it at Don José, who has been ignoring her, before going back into the factory with the others. José is annoyed by her insolence.
Micaëla returns and gives him a letter —and a kiss— from his mother. José longingly thinks of his home, and reading the letter sees that his mother wants him to return and get married. Micaëla is embarrassed and leaves, but Don José declares that he will marry her.
As soon as she leaves, screams are heard from the factory and the women run out, singing chaotically. Don José and Zuniga find that Carmen has been fighting with another woman, and slashed her face with a knife. Zuniga asks Carmen if she has anything to say, but she replies impudently with a song. Zuniga instructs José to guard her while he writes out the warrant for prison. The women go back into the factory and the soldiers to the guardhouse. To escape, Carmen seduces José with a Seguidilla about an evening she will spend with her next lover who is "only a corporal"; José gives in and unties her hands. Zuniga returns, and Carmen allows herself to be led away but turns, pushes José to the ground, and as laughing cigarette girls surround Zuniga, she escapes.